New developments have come about regarding short sales, specifically Bank of America and Wells Fargo. In the attached addenda, I have provided copies of both banks' newly "required" additions to the purchase agreement. The Bank of America document is marked up with legal counsels highlights and comments. >>UNDER ADVICE FROM OUR ATTORNEY AND REGIONAL LEADERSHIP, UNDER NO CIRCUMSTANCES ARE YOU TO SIGN THESE DOCUMENTS REGARDLESS OF THE BANK'S UNWILLINGNESS TO PROCEED OTHERWISE. >>I cannot stress to you the importance of this information. These two banks are now requiring the brokers involved to become actual parties to the transaction, placing you and our brokerage at significant risk. In addition, there are other portions of the agreement that increase your risk exposure.

Rita - I believe we put ourselves at SIGNIFICANT risk simply by doing short sales. I've downloaded your attachment and will "digest" it before I comment further on it. However, if I followed thestrict advice of even my own attorney, I wouldn't be doing short sales at all. My fiduciary responsibility is to the seller and if I've agreed to assist them with a short sale and stand in the way of it's successful closing simply because I refuse to sign an addendum which is, in effect, truthful, then I have FAILED my client. I believe that puts me in a least as much legal jeopardy as signing the addendum in the first place. Our risk exposure is extreme in this business and I don't take it lightly so I'll read this and get back to you!

EVERYONE needs to read what Rita wrote...I just had the attorney I work for review her pdf and he about had a heartattack..we are not to sign these...it opens you up to liability and requires you to break your license oaths...this is very serious and I assume will be addressed by attorneys all over the US....example: If you have a house with a debt of $300k and you sell it for $200k and the buyer turns around and sells it for $250k..the bank can come after you the broker, the buyer and the seller for the $50k difference....essentially BOA and WElls Fargo are trying to stomp out anyone making money on short sales...thanks for this Rita...good catch!!!

New developments have come about regarding short sales, specifically Bank of America and Wells Fargo. In the attached addenda, I have provided copies of both banks' newly "required" additions to the purchase agreement. The Bank of America document is marked up with legal counsels highlights and comments. >>UNDER ADVICE FROM OUR ATTORNEY AND REGIONAL LEADERSHIP, UNDER NO CIRCUMSTANCES ARE YOU TO SIGN THESE DOCUMENTS REGARDLESS OF THE BANK'S UNWILLINGNESS TO PROCEED OTHERWISE. >>I cannot stress to you the importance of this information. These two banks are now requiring the brokers involved to become actual parties to the transaction, placing you and our brokerage at significant risk. In addition, there are other portions of the agreement that increase your risk exposure.

There is always risk..true..but this documents is way out there are exposure and liability....even if you decide to sign the addendum, you will by violating your license as a realtor..plus you will have to let the sellers know that they face civil and criminal liability...hmmm...I don't think too many sellers are going to want to be on the hook for that kind of money...the degree of this is going to vary from deal to deal...but I wouldn't take it lightly....This will more than likely start being addressed by lawyers all over the US..because in essence the bank is asking you to violate your oath...your oath is to the seller...not to the bank....the attorney I work for is fixing to draft up a document to challenge BOA on this addendum...it truly is insane..thanks again to Rita....Kayte Gentry said:

Rita - I believe we put ourselves at SIGNIFICANT risk simply by doing short sales. I've downloaded your attachment and will "digest" it before I comment further on it. However, if I followed thestrict advice of even my own attorney, I wouldn't be doing short sales at all. My fiduciary responsibility is to the seller and if I've agreed to assist them with a short sale and stand in the way of it's successful closing simply because I refuse to sign an addendum which is, in effect, truthful, then I have FAILED my client. I believe that puts me in a least as much legal jeopardy as signing the addendum in the first place. Our risk exposure is extreme in this business and I don't take it lightly so I'll read this and get back to you!

Wow!!! I reviewed that attachment serveral times!!! (I wonder what the attorney fee was for that "mark up"?) Please keep us posted if your company is successful on refusing to execute these!

-First, that is a pretty "standard" arms length form, yes the word "addendum" scares me has it does modify a contract, and this very one tends to make the "agents" parties! Heck we can always become "parties" especially in law suits. Perhaps some of our attorney members can comment on this!

The sad part is that most lenders have made this part of allowing a short sale! WHY? Because every potential sleezy item that is addressed in these docs, has happened actually alot! I have seen these things come to play at the very onset of short sales!

What a deal! Sellers, friend, relative ect, buys short sale property, Seller rents back, and someday down the line buys it back from the landlord! Yes, a lot of buyer's were taken advantage of in the hot market! There was no such thing as a "starter home", they bought the bigest, expensive house, that a mortgage company would "qualify" them to have, not even thinking how they would pay that monthly payment they signed for because of their "stated income".

We as agents, were never allowed by law to make "side deals" receive compensation out side the deal, offer kick backs etc or was buyer and seller! (without a heck of lot of disclosure!)

-Another note: Dual agency!!! Well that is agains the law in Florida.. ( I dont even what to get starter on that! ) So I dont have a problem here, (we are copp-out "transaction brokers" However, my company acts as single agent to seller, non-rep to buyer. I have done many times "disclosed dual agency" in Connecticut! (didnt have any problem with it!) So I do wonder how these arms lengh transactions affect states that do allow dual agency! As I mentioned in a previous post, I am not confortable assigning or putting another agents name on the contract to avoid this, I rather fight it! I am hoping that NAR will aggressively work with lenders to help them understand this. This happens with REO's also! Heck why is everyone in our pockets! It' nice to "double dip" once in awhile!

New developments have come about regarding short sales, specifically Bank of America and Wells Fargo. In the attached addenda, I have provided copies of both banks' newly "required" additions to the purchase agreement. The Bank of America document is marked up with legal counsels highlights and comments. >>UNDER ADVICE FROM OUR ATTORNEY AND REGIONAL LEADERSHIP, UNDER NO CIRCUMSTANCES ARE YOU TO SIGN THESE DOCUMENTS REGARDLESS OF THE BANK'S UNWILLINGNESS TO PROCEED OTHERWISE. >>I cannot stress to you the importance of this information. These two banks are now requiring the brokers involved to become actual parties to the transaction, placing you and our brokerage at significant risk. In addition, there are other portions of the agreement that increase your risk exposure.

Since I can not attest to what the buyer and the buyer's agent have agreed upon, or what the buyer's intention for the home, I have no desire to sign this document. We and the seller are going to be on the hook all the way around if we start signing these.

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